South Africa EconomyWhat you should know about the South Africa economyThe South Africa economy is ruled by diversity. There are well-developed areas and less-developed, laid-back areas. Both sides show heavily in the economy. You can easily come across these harsh divides as soon as you leave the boundaries of any bigger city in South Africa. 
In the cities Cape Town, Durban, Port Elizabeth and Johannesburg one could will find oneself transplanted to one of the big first world countries, where infrastructure and business sectors are quite well developed. On first sight you feel transplanted to any western metropolis. However, as soon as one steps outside of these South African economic hubs or leaves tourist ground one quickly feels set back and feels that South Africa still is a developing county. Unemployment is still high at an average 25% of the population, but many initiatives try to open opportunities for the previously disadvantaged population. The Broad Based Black Economic Empowerment or BBEEE-Act was initiated in 2003 to create more awareness of discrepancies between the races and to have a working affirmative action tool to ensure better opportunities for the black South African population . The infrastructure is well advance in most regions, but there are still remaining problems to encounter the massive influx of rural population around the big cities like Cape Town and Johannesburg. However there are transport problems due to the growing population and a well working and safe public South African transport system has still to be installed. Are you looking for information on the finance sector and Banking in South Africa ? South Africa has got a well regulated financial system and the South African Minister of Finance Trevor Manuel is one of the most highly respected politicians in South Africa. Gateway to AfricaBut the country is not only an economy of the emerging markets, but also a Gateway to Africa.South Africa shares borders with Namibia, Botswana, Zimbabwe, Mozambique, Lesotho and Swaziland and acts as a safe and reliable transport hub with its major airports and seaports on the Southern African continent. Here on the picture you see the Cape Town CBD with the harbour which recently undergoes huge restructuring measures. The harbour already offers one of the biggest container port facilities in the Southern Hemisphere.
Biggest business sectors in the South African economyThe main business sectors in South Africa are: Mining, Finance and Real Estate and Business Services, Information and Communication Sector, Tourism, Manufacturing, Chemical Industry and Agriculture.South Africa has got plenty of natural resources: Gold, platinum, diamonds are the biggest resources. Other main business sectors are finance and real estate sector, tourism and service industry. The country ranks in the Top 25 countries in the chemical industry and plays an important part in the manufacturing business especially the automotive industry. Many of the big brand car manufacturers have their production lines set up in the Eastern Cape in South Africa. Although the textile industry is not as strong as it once was it is still one of the dominant industries in the country. South Africa is the African leader in the information and communication technology (ICT) sector and growing as a hub for IT specialists as it is among the 20 biggest consumers worldwide in computer and IT services. South Africa Trade PartnersThe five biggest trade partners in 2007 are:the USA, Germany, UK, Japan and the Netherlands for exports and Germany, China, Japan, USA and UAE for imports. The largest foreign investments do come from the United Kingdom. Cape Town Economy – Business GuideCape Town is certainly with Johannesburg the economic center in South Africa. With major expansion work at the Cape Town International Airport and Cape Town Port the Mother City puts its name on the map as major business center on the African Continent.The Western Cape is the most prosperous and well governed region in South Africa and so many businesses prefer opening offices in this region. Proximity to good transport networks and good education levels in the Western Cape Population offer many a possibility for investors looking for excellent business potential in this region. For information on Doing Business in Cape Town and Business Etiquette in South Africa go to my Cape Town Business Guide. How stable is the South African economy?Currently the whole world is experiencing a slowdown of economic growth. Even India and China register less growth due to high energy costs and trouble in the American market. This slowdown in the US economy, the melt down of the financial sector and less growth forecasted for the Eastern economies, investors turn to Africa now for investments and keeping their assets safe and with returns.The financial sector here is robust and quite well regulated and is rated as one of the more stable financial systems worldwide. The South African foreign debt is comparably low and the attraction for foreign investment is high with great interest rates and a stable market. South Africa still seems to cope with the higher prices in the oil and food sector even though there are worries about a looming energy crisis. South Africa experienced their highest economic growth in the last years and even during times of economic turmoil there is slight growth figures of around 1% expected for 2009, while the rest of the world will register massive deficits. What are the major problems the South Africa economy is facing?• There is the highly criticized and well documented skills shortage in many employment sectors of the South Africa economy. • The still high unemployment figures especially in rural areas. The unemployment rate hovers around 25% in 2007, which is down from 30% in 2002. This means there is a slow growing black middle class. This success came mainly through successful government initiatives like the Joint Initiative on Priority Skills Acquisition and the Expanded Public Works Program released by Statistics SA end of March 2008. But you can see the light: There are also more registered taxpayers in 2007 which shows the economy is improving significantly. There are now more than 5 million taxpayers compared to 3 million three years ago. • The energy crisis which affects all business areas. The state regulated power supplier ESKOM is currently expanding its network which is sometimes down due to power scarcity. The state of the countries water supplies is in certain regions not acceptable. • Combating crime is also one of the major challenges the South Africa economy faces in future. South Africa Economy ResourcesIf you are looking for resources on the South Africa economy or references on my article on the economy of South Africa, please refer to these sites:• www.doingbusiness.org by The World Bank Group • www.statssa.gov.za by Statistics South Africa • www.engineeringnews.co.za: news regarding the engineering sector • www.miningweekly.co.za: news regarding the mining sector • www.ictworld.co.za: Computing SA with news for the IT sector and company listings
If you are looking for information regarding business associations , then read my South African business association listing and resources.
Questions or comments regarding the South Africa economy? Then contact me here. Return from South Africa Economy to ExpatCapeTown Homepage
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